Narrative

Chronological order of events

  1. Xavier wrote to YY stating, “I hear you have a Nokia 7600 mobile for sale. I would be interested in buying it for $2,000 if it is in good condition.”
  2. YY wrote back to Xavier, “I agree to sell the phone to you but there are still a few things which need doing to it before it is fully usable.” However, the letter was lost in the post.
  3. Xavier wrote a week later stating, “As I have not heard from you I assume the price was not enough. Will you accept $3,000?”
  4. YY replied by e-mail to Xavier’s e-mail address in her office saying, “I accept the offer.” Unfortunately, Xavier was away and did not check her e-mails and three weeks later returned to check the e-mails and found the message from YY. Meanwhile, YY having heard nothing sold the phone to Tommy for $2,500.

Advise

Synopsis

  • To advise Xavier, needed to consider whether or not a contract had been formed with YY.
  • In order to determine whether there are contract formed, it is necessary to conduct the traditional analysis of offer and acceptance.
  • Was Xavier’s written statement, e.g. letter to YY to be an offer or an invitation to treat [Gibson v. Manchester City Council (1979) and Storer v. Manchester City Council (1974)] or a preliminary statement as to price [Clifton v. Palumbo (1944)] or request information [Harvey v. Facey (1893)]?
  • Firstly, “invitation to treat”, where it is a statement of willingness to contract on certain terms if the other party offers to deal on those terms – an invitation to others asking them to make offers.  
  • Secondly, offer is defined as “an expression of willingness to contract on certain terms, made with the intention that a binding contract will exist once the offer is accepted.” [The Common Law of Obligations, 3rd Edition, Cooke & Oughton, Butterworths 2000, p.28]
  • Thirdly, a request of information is not an offer and neither is a reply to such request unless the respondent so indicates.
  • To be an offer (whether an original offer or a counter offer), a statement must contain a promise or promises and not just a fact or information, as was indicated in Harvey v. Facey (1893). So the question becomes did Xavier intend his statement to be a promise to buy the mobile phone on condition that he expected in good condition as he thought?
Join now!
  • Admittedly, Xavier‘s statement/letter was objectively exhibited the request of information or a preliminary statement as to price. In other words, Xavier did not create a firm offer with the intention to commit legally binding. Nevertheless, Xavier introduced unclear or vague term/condition in his letter/statement that he was willing to buy the mobile phone priced at $2,000 in such that the mobile was in good condition. In this contrast, it is questionable in whether Xavier would buy the mobile or not, as if it did not in good condition as Xavier expected. Consequently, it would be possible to encourage further ...

This is a preview of the whole essay